5 ms·

Dutch government in panic mode over keeping ASML in the country

39 points by neverrroot 3y ago

diggan 3y ago
> The company now has to apply for Dutch export licenses for its most advanced DUV and EUV gear, plus US government licenses for some systems destined for China. The latter market accounted for over a quarter of its net sales last year. ® ASML is still Dutch, as far as I understand, but I guess they already have offices in the US or something? Why would a US government license be required for a Dutch company to sell to Chinese customers?
- atemerev 3y ago
  Because it uses some American tech or patents, and there is leverage and pressure point over these.
- deleted 3y ago
  [deleted]
- wil421 3y ago
  Lots of people have said it before. ASML bought Silicon Valley Group after ASML was not granted an EUV license for whatever reason along with a couple of familiar Japanese companies. EUV LLC is owned by the DOE/US government and others in a private/public consortium. In the 2000s ASML bought Silicon Valley Group (SVG) to develop EUV lithography. Now ASML has to abide by the EUV LLC license terms which include US congressional oversight. It’s the US governments tech commercialized by a Dutch multinational company who also has to abide by Dutch export and government restrictions.
  - diggan 3y ago
    Thanks a lot for the elaborate explanation that went into specific details of why things are like they are.
    - Kon-Peki 3y ago
      To expand just a little bit more - the core technology for EUV was developed at US national laboratories run by the Department of Energy and paid for by the US taxpayers. The licenses and limitations are the standard used for all technology coming out of the national laboratories; it is only unusual because ASML is not located in the US.
- DiogenesKynikos 3y ago
  The US makes heavy use of secondary sanctions to coerce foreign companies and governments into restricting business with America's "enemies." The US has leverage to do this, because much of the world's financial transactions run through the US financial system, and much of the world's financial industry has significant exposure to the US. If ASML shrugs off the US government's demands, it will quickly find itself shut off from every major bank, and every supplier who wants to avoid the same fate will cut off its business with ASML. In the specific case of ASML, however, the US also has a Cold-War-era agreement with the Netherlands on transfer of technology to other countries.[0-1] 0. https://en.wikipedia.org/wiki/Wassenaar_Arrangement https://en.wikipedia.org/wiki/Wassenaar_Arrangement 1. https://www.reuters.com/technology/amid-us-pressure-dutch-announce-new-chip-equipment-export-rules-2023-06-30/ https://www.reuters.com/technology/amid-us-pressure-dutch-an...
deleted 3y ago
[deleted]
atemerev 3y ago
It is really counterproductive policy to keep highly qualified immigrant workers from coming into the country. And sadly common everywhere.
- eythian 3y ago
  In this case (like, as you say, common) the current centre-right caretaker government, and even moreso the elected-but-not-yet-coalesed incoming government are pandering to populist ideas which includes "immigration bad", reducing (the already reduced) tax breaks on people who move as knowledge workers, threatening to cap numbers, etc. It speaks well to a lot of voters, especially when lined up with "but there's not enough housing anyway", but it will, imo, cause damage to economic growth.
  - ouroborosidiots 3y ago
    Isn't "right leaning" supposed to mean "lower taxes" in most places?
    - bgnn 3y ago
      Not in the Netherlands. Nobody wants to reduce taxes except liberals.
DiogenesKynikos 3y ago
This reminds me of the arguments over visas for tech workers in the US. A common argument I hear is that immigration is robbing Americans of high-tech jobs in Silicon Valley. I think the mistake in those arguments is that there's no intrinsic reason why the world's tech sector has to be so concentrated in Silicon Valley. The major reason why the industry continues to be so concentrated in Silicon Valley is because that is where the workforce is. If the flow of skilled workers to Silicon Valley - from all over the world - is choked off, the industry will move to where the high-skill workforce is. The Dutch seem to be testing out this theory in real life. I would guess that ASML is heavily dependent on highly educated people who come from all over the world, and that restricting its workforce to Dutch (or even EU) citizens would severely damage the company.
- deleted 3y ago
  [deleted]
- jevoten 3y ago
  People are perhaps not so enthusiastic about giving away their countries just so multinational companies with no loyalty to them don't leave. On the other hand, China, Japan, Taiwan, and South Korea all manage to have highly-successful tech industries (tech, not ads and social media) with near-zero immigration.
  - nequo 3y ago
    > China, Japan, Taiwan, and South Korea all manage to have highly-successful tech industries At salaries and with work hours that are far from enviable.
  - DiogenesKynikos 3y ago
    Those countries have much stronger educational systems (at least K-12) and a much stronger devotion to education than the US. On the other hand, the US benefits massively from its research universities, which attract large numbers of top-quality graduate students from around the world, many of whom remain in the US after their studies and make up much of the tech workforce. > giving away their countries How does immigration of highly skilled tech workers in any way "give away the country"?
9dev 3y ago
It is sad how right-wing populists in Europe seem to take over overwhere. This is just one example of the mayhem they cause with short-sighted, fear-driven policy making -- I dread the upcoming votes in Germany, when the AfD (a far-right, but very successful party) is going to expand their power considerably.
- bryanlarsen 3y ago
  Yet people generally believe that right wing parties are good for business, despite massive piles of evidence to the contrary.
  - snehk 3y ago
    Germany's current government is anything but right wing and it's the only large economy on this planet that's literally shrinking.
    - bryanlarsen 3y ago
      You don't count the UK & Japan as large economies? And I didn't say that left-wing parties were good for the economy, I just said that right-wing parties weren't. If you want a business-friendly party, you have to examine their platforms. For example, Trump's 10% import tariff proposal would destroy the American economy. But that sort of proposal is more common in left wing parties.
    - blackbear_ 3y ago
      The current government doesn't have much to do with it, though. This is the results of decades of over-reliance on cheap gas from Russia for energy, chronic lack of investment in infrastructure, and perhaps a little complacency.
huijzer 3y ago
> But it appears that being able to hire the right personnel is not the only concern. Problems with electricity grid congestion affecting industrial power supplies and attempts to limit nitrogen emissions are also said to be issues raised by the company. Must play a role too, yes. It was reported a few weeks ago that a primary school in Veldhoven (the relatively small town where ASML’s headquarters is) will not get access to the power grid. They will place a diesel generator next to the school for the next few years [1]. [1]: https://nos.nl/video/2510756-een-splinternieuw-schoolgebouw-maar-geen-stroom https://nos.nl/video/2510756-een-splinternieuw-schoolgebouw-...
rvschuilenburg 3y ago
> Some of these are to curb immigration, including moves to end tax breaks for highly skilled foreign employees that are being implemented by the current administration. I haven't read more about this besides this article, but why should highly skilled foreign employees receive tax breaks?
- 0xfaded 3y ago
  Denmark does this, but only for a limited period (7 years I think). Part of it is competitiveness to make competing for top talent on par with lower tax countries. The other part is the temporary nature since higher earners are more likely to return to their home countries.
  - rvschuilenburg 3y ago
    I have mixed feelings about this. The Netherlands is an expensive country to live in, and this is paid for using taxes. If you decide to live and work in The Netherlands, i would expect you to pay the same amount of taxes as others. Then again, i can understand the argument that indirectly the company is paying tons of taxes because it is a big company. Losing that company + its employees might be a bigger negative in tax income than having those employees pay less taxes.
    - blackbear_ 3y ago
      What you are saying is totally reasonable, but perhaps you are not considering the additional costs trat migrants face when establishing themselves in a new country. Not only financial, but also immaterial costs such as leaving behind friends and family, dealing with the language barrier, bureaucracy, the initial loneliness, occasional xenophobic manifestations, maybe cultural differences, etc. In this light I think that temporary tax breaks like this are a nice way to ease immigration and create more of a win-win situation. > If you decide to live and work in The Netherlands, i would expect you to pay the same amount of taxes as others. Fair, but worth noting that highly skilled migrants are also paid more than average, and thus the absolute amount of tax contributed in their lifetime turns out higher despite a few years of tax breaks.
fjfaase 3y ago
Immigrants get a 30% tax break, meaning that they only have to pay income taxes over 70% of their income. For the average income of people working at ASML, I guess that they have to pay about 30% taxes. It basically means that ASML can pay less to immigrants workers compared to native workers to give them the same salary. In the Netherlands we are currently having a housing crisis, which is partly caused by labor immigration. This has caused many people, especially those from gen Z, being unable to buy a house. In and around Veldhoven, where ASML has its main offices, house prices have gone up. ASML is investing some money in housing projects. For these reasons, some political parties feel that the tax break should be removed. Which would mean that ASML would have to pay their employees more and due to this they will make less profits. ASML is depending on many companies in and around Veldhoven/Eindhoven and even on some further away for parts of their machines. For that reason, I think it would not be that easy for them to relocate to a different country. They would have to build up contact with local parts produces. If the move to a different country, it maybe also would mean that a part of their employees is not willing to relocate.
- tmaly 3y ago
  I see an ASML lithography division here in Connecticut that I drive by from time to time. I believe they also have a division in California.
  - fjfaase 3y ago
    I get the impression that the development of their waver steppers is still in Veldhoven. It is there were they are assembled and where improvements are tested. It is easy to move production departments, than research and development. It might be the case that part of the research and development is done in close cooperation with some of the suppliers. Their waver steppers have (probably) millions of parts that all have to work together.
- bgnn 3y ago
  Oh that would be quite easy for them since all these companies can ship the parts wherever ASML wants. They rely a lot of companies in Germany and Belgium, Korea, Taiwan, Japan, USA too.
bgnn 3y ago
ASML doesn't belong to NL. This isn't a country for productive economy. Dutch hate anything other than finance and farming. It's much better if they move to Germany, or better yet to France with nuclear energy!
- the_third_wave 3y ago
  The Dutch quite liked Philips Electronics when that was still a thing. Also, DAF Trucks, Océ printers/copiers and some others. The slogan Koopt Nederlandsche waar, dan helpen wij elkaar (Buy Dutch products so we help each other) used to be a thing and still rings true in (an aging) part of the population.

39 points by neverrroot 3y ago

> The company now has to apply for Dutch export licenses for its most advanced DUV and EUV gear, plus US government licenses for some systems destined for China. The latter market accounted for over a quarter of its net sales last year. ® ASML is still Dutch, as far as I understand, but I guess they already have offices in the US or something? Why would a US government license be required for a Dutch company to sell to Chinese customers?

atemerev 3y ago
Because it uses some American tech or patents, and there is leverage and pressure point over these.
deleted 3y ago
[deleted]
wil421 3y ago
Lots of people have said it before. ASML bought Silicon Valley Group after ASML was not granted an EUV license for whatever reason along with a couple of familiar Japanese companies. EUV LLC is owned by the DOE/US government and others in a private/public consortium. In the 2000s ASML bought Silicon Valley Group (SVG) to develop EUV lithography. Now ASML has to abide by the EUV LLC license terms which include US congressional oversight. It’s the US governments tech commercialized by a Dutch multinational company who also has to abide by Dutch export and government restrictions.
- diggan 3y ago
  Thanks a lot for the elaborate explanation that went into specific details of why things are like they are.
  - Kon-Peki 3y ago
    To expand just a little bit more - the core technology for EUV was developed at US national laboratories run by the Department of Energy and paid for by the US taxpayers. The licenses and limitations are the standard used for all technology coming out of the national laboratories; it is only unusual because ASML is not located in the US.
DiogenesKynikos 3y ago
The US makes heavy use of secondary sanctions to coerce foreign companies and governments into restricting business with America's "enemies." The US has leverage to do this, because much of the world's financial transactions run through the US financial system, and much of the world's financial industry has significant exposure to the US. If ASML shrugs off the US government's demands, it will quickly find itself shut off from every major bank, and every supplier who wants to avoid the same fate will cut off its business with ASML. In the specific case of ASML, however, the US also has a Cold-War-era agreement with the Netherlands on transfer of technology to other countries.[0-1] 0. https://en.wikipedia.org/wiki/Wassenaar_Arrangement https://en.wikipedia.org/wiki/Wassenaar_Arrangement 1. https://www.reuters.com/technology/amid-us-pressure-dutch-announce-new-chip-equipment-export-rules-2023-06-30/ https://www.reuters.com/technology/amid-us-pressure-dutch-an...

deleted 3y ago

[deleted]

atemerev 3y ago

It is really counterproductive policy to keep highly qualified immigrant workers from coming into the country. And sadly common everywhere.

eythian 3y ago
In this case (like, as you say, common) the current centre-right caretaker government, and even moreso the elected-but-not-yet-coalesed incoming government are pandering to populist ideas which includes "immigration bad", reducing (the already reduced) tax breaks on people who move as knowledge workers, threatening to cap numbers, etc. It speaks well to a lot of voters, especially when lined up with "but there's not enough housing anyway", but it will, imo, cause damage to economic growth.
- ouroborosidiots 3y ago
  Isn't "right leaning" supposed to mean "lower taxes" in most places?
  - bgnn 3y ago
    Not in the Netherlands. Nobody wants to reduce taxes except liberals.

DiogenesKynikos 3y ago

This reminds me of the arguments over visas for tech workers in the US. A common argument I hear is that immigration is robbing Americans of high-tech jobs in Silicon Valley. I think the mistake in those arguments is that there's no intrinsic reason why the world's tech sector has to be so concentrated in Silicon Valley. The major reason why the industry continues to be so concentrated in Silicon Valley is because that is where the workforce is. If the flow of skilled workers to Silicon Valley - from all over the world - is choked off, the industry will move to where the high-skill workforce is. The Dutch seem to be testing out this theory in real life. I would guess that ASML is heavily dependent on highly educated people who come from all over the world, and that restricting its workforce to Dutch (or even EU) citizens would severely damage the company.

deleted 3y ago
[deleted]
jevoten 3y ago
People are perhaps not so enthusiastic about giving away their countries just so multinational companies with no loyalty to them don't leave. On the other hand, China, Japan, Taiwan, and South Korea all manage to have highly-successful tech industries (tech, not ads and social media) with near-zero immigration.
- nequo 3y ago
  > China, Japan, Taiwan, and South Korea all manage to have highly-successful tech industries At salaries and with work hours that are far from enviable.
- DiogenesKynikos 3y ago
  Those countries have much stronger educational systems (at least K-12) and a much stronger devotion to education than the US. On the other hand, the US benefits massively from its research universities, which attract large numbers of top-quality graduate students from around the world, many of whom remain in the US after their studies and make up much of the tech workforce. > giving away their countries How does immigration of highly skilled tech workers in any way "give away the country"?

9dev 3y ago

It is sad how right-wing populists in Europe seem to take over overwhere. This is just one example of the mayhem they cause with short-sighted, fear-driven policy making -- I dread the upcoming votes in Germany, when the AfD (a far-right, but very successful party) is going to expand their power considerably.

bryanlarsen 3y ago
Yet people generally believe that right wing parties are good for business, despite massive piles of evidence to the contrary.
- snehk 3y ago
  Germany's current government is anything but right wing and it's the only large economy on this planet that's literally shrinking.
  - bryanlarsen 3y ago
    You don't count the UK & Japan as large economies? And I didn't say that left-wing parties were good for the economy, I just said that right-wing parties weren't. If you want a business-friendly party, you have to examine their platforms. For example, Trump's 10% import tariff proposal would destroy the American economy. But that sort of proposal is more common in left wing parties.
  - blackbear_ 3y ago
    The current government doesn't have much to do with it, though. This is the results of decades of over-reliance on cheap gas from Russia for energy, chronic lack of investment in infrastructure, and perhaps a little complacency.

huijzer 3y ago

> But it appears that being able to hire the right personnel is not the only concern. Problems with electricity grid congestion affecting industrial power supplies and attempts to limit nitrogen emissions are also said to be issues raised by the company. Must play a role too, yes. It was reported a few weeks ago that a primary school in Veldhoven (the relatively small town where ASML’s headquarters is) will not get access to the power grid. They will place a diesel generator next to the school for the next few years [1]. [1]: https://nos.nl/video/2510756-een-splinternieuw-schoolgebouw-maar-geen-stroom https://nos.nl/video/2510756-een-splinternieuw-schoolgebouw-...

rvschuilenburg 3y ago

> Some of these are to curb immigration, including moves to end tax breaks for highly skilled foreign employees that are being implemented by the current administration. I haven't read more about this besides this article, but why should highly skilled foreign employees receive tax breaks?

0xfaded 3y ago
Denmark does this, but only for a limited period (7 years I think). Part of it is competitiveness to make competing for top talent on par with lower tax countries. The other part is the temporary nature since higher earners are more likely to return to their home countries.
- rvschuilenburg 3y ago
  I have mixed feelings about this. The Netherlands is an expensive country to live in, and this is paid for using taxes. If you decide to live and work in The Netherlands, i would expect you to pay the same amount of taxes as others. Then again, i can understand the argument that indirectly the company is paying tons of taxes because it is a big company. Losing that company + its employees might be a bigger negative in tax income than having those employees pay less taxes.
  - blackbear_ 3y ago
    What you are saying is totally reasonable, but perhaps you are not considering the additional costs trat migrants face when establishing themselves in a new country. Not only financial, but also immaterial costs such as leaving behind friends and family, dealing with the language barrier, bureaucracy, the initial loneliness, occasional xenophobic manifestations, maybe cultural differences, etc. In this light I think that temporary tax breaks like this are a nice way to ease immigration and create more of a win-win situation. > If you decide to live and work in The Netherlands, i would expect you to pay the same amount of taxes as others. Fair, but worth noting that highly skilled migrants are also paid more than average, and thus the absolute amount of tax contributed in their lifetime turns out higher despite a few years of tax breaks.

fjfaase 3y ago

Immigrants get a 30% tax break, meaning that they only have to pay income taxes over 70% of their income. For the average income of people working at ASML, I guess that they have to pay about 30% taxes. It basically means that ASML can pay less to immigrants workers compared to native workers to give them the same salary. In the Netherlands we are currently having a housing crisis, which is partly caused by labor immigration. This has caused many people, especially those from gen Z, being unable to buy a house. In and around Veldhoven, where ASML has its main offices, house prices have gone up. ASML is investing some money in housing projects. For these reasons, some political parties feel that the tax break should be removed. Which would mean that ASML would have to pay their employees more and due to this they will make less profits. ASML is depending on many companies in and around Veldhoven/Eindhoven and even on some further away for parts of their machines. For that reason, I think it would not be that easy for them to relocate to a different country. They would have to build up contact with local parts produces. If the move to a different country, it maybe also would mean that a part of their employees is not willing to relocate.

tmaly 3y ago
I see an ASML lithography division here in Connecticut that I drive by from time to time. I believe they also have a division in California.
- fjfaase 3y ago
  I get the impression that the development of their waver steppers is still in Veldhoven. It is there were they are assembled and where improvements are tested. It is easy to move production departments, than research and development. It might be the case that part of the research and development is done in close cooperation with some of the suppliers. Their waver steppers have (probably) millions of parts that all have to work together.
bgnn 3y ago
Oh that would be quite easy for them since all these companies can ship the parts wherever ASML wants. They rely a lot of companies in Germany and Belgium, Korea, Taiwan, Japan, USA too.

bgnn 3y ago

ASML doesn't belong to NL. This isn't a country for productive economy. Dutch hate anything other than finance and farming. It's much better if they move to Germany, or better yet to France with nuclear energy!

the_third_wave 3y ago
The Dutch quite liked Philips Electronics when that was still a thing. Also, DAF Trucks, Océ printers/copiers and some others. The slogan Koopt Nederlandsche waar, dan helpen wij elkaar (Buy Dutch products so we help each other) used to be a thing and still rings true in (an aging) part of the population.